Household Composition

New York City families with young children are more likely to struggle to make ends meet and cover the high cost of child care. Income inadequacy rates increase if the children present in the household are younger than five years old. Moreover, households headed by women have higher rates of income insufficiency regardless of the presence of children when compared to households headed by men and married-couple households.

Presence of Children

Compared to households without children, the rate of income inadequacy for households with children increases from 44% to 63% (Figure J). The presence of children, particularly young children, has a large impact on household budgets. Reflecting the need for full-time child care, households with at least one child under the age of five have a higher rate of income inadequacy than households with only school-age children or teenagers (65% compared to 61%). As a result, while households with children only account for 32% of all households in New York City, over 40% of households with inadequate incomes have children present (see Figure K).

Table 7 in the Appendix documents the change in profile of households since the previous calculation of the TCL (formerly the New York City Self-Sufficiency Standard). The largest change occurs in the households with no children, increasing by nine percentage points (from 51% in 2019 to 60% of all households below the TCL currently). The total number of all working-age New York City households with no children increased by 19 percentage points since the last calculation. This increase would normally lead to a reduction in total households below the TCL, as households with no children tend to have lower expenses as a result of not having to pay for child care. However, this increase in childless households below the TCL, shows that even households with no children and lower expenses are having trouble covering other growing costs such as housing and food.

Children, Household Type, and Race/ Ethnicity

Single mothers are disproportionately represented among households with inadequate incomes. While single mothers head 10% of all households, they comprise 17% of all households with inadequate income. Overall, single mothers experience the highest rates of income inadequacy compared to other household compositions, with fourth-fifths (80%) having inadequate income (see Figure L).

This high rate is at least partially correlated to gender. Among households without children (which are mostly single persons living alone), the rate of income inadequacy for households headed by men is 44% compared to 48% for households headed by women. In other words, men and women living alone, already have an income inadequacy gap of about four percentage points.20 It is important to note that given the way the ACS phrases the survey question, there is inadequate information about households that include parents who do not identify as men or women (see text box on the next page for more information).

When we further examine the impact of the presence of children, we see even higher income inadequacy rates for households headed by single mothers, worsening the existing gender and racial disparities.

The dashed lines on Figure L show the overall income inadequacy rates for each household type, with the bars contrasting the differences of households by race/ ethnicity. When we divide households by presence of children, those with children have considerably higher rates of income inadequacy. Unfortunately, the sample size for the American Indian population was too low to generate any conclusive analysis.

• Married-couple households without children have the lowest income inadequacy rate (37%). Among married-couples with children, the income inadequacy rate increases to 52%. However, this disparity changes when examining by family status and race/ ethnicity. For example, 25% of White married-couple households without children have insufficient income while 49% of Latine married households without children struggle to make ends meet. When children are present in the household the gap grows even more drastic, with 33% of White married couples having inadequate income, but 68% of Latine, 62% of Asian, Native Hawaiian, or Pacific Islander (NHPI), and 52% of Black married couples with children unable to cover their basic costs.

• Households headed by men without children have an income inadequacy rate of 44%, while the income inadequacy rate increased to 69% for single fathers.21 More than four out of five (81%) single father and Latine-headed households do not have income that adequately supports their family compared to 32% of White single fathers.

Sex and Gender. The ACS asks respondents to indicate if they are either male or female, thus excluding people who do not identify with either—limiting the analysis to a binary framework due to the nature of the survey question. Additionally, while the survey question asks for a person’s sex, this report uses gender for an analysis framework with the assumption that inequities in income inadequacy rates are a result of the socially constructed characteristics and norms assigned to men and women, not their biological status.

• Households headed by women without children have an income inadequacy rate of 48%. As a broad category, single mothers have the highest rate of income inadequacy at 80%. Put another way, four out of five single mothers do not earn income adequate to meet their basic needs. Income inadequacy rates among single mothers of color are the highest: 87% of Latine, 79% of Black, and 73% of Asian, Native Hawaiian, or Pacific Islander mothers lack adequate income compared to 60% of White single mothers.

Parents, particularly single mothers, experience higher levels of income inadequacy than individuals and couples without children. The very high rates of income inadequacy for single mothers compared to single fathers suggests that a combination of gender and the presence of children—being a woman with children—contributes to the high rates of income inadequacy. Furthermore, as rates of income inadequacy are high among communities of color regardless of family type, when children are present, households of color are at increased risk of lacking sufficient income to meet the costs of basic needs. As demonstrated in the chapter on race and ethnicity, these findings indicate that further research should be done to disaggregate the racial categories to understand the nuance of disparity in family type within broader racial groups.

Households with Young Children

Due to the high cost of child care, households with younger children (five years and younger) have the highest rates of income inadequacy in New York City for each household type. Figure M illustrates the monthly NYC TCL of three different household scenarios as a child ages in Queens: a single adult with an infant, school-age child, and teenager. The child care costs for this family decrease from $1,589 as an infant, to $925 as a school-age child requiring before and after school care, and then finally to no child care cost when the child becomes a teenager. The bar chart also contrasts the monthly TCL costs with the monthly Official Poverty Measure ($1,643 for a family of two), illustrating stark gaps between the Official Poverty Measure and the actual basic need costs of families at any age.

Consistent with other data trends, households led by single mothers experience the highest rates of income inadequacy with 86% unable to cover the cost of basic needs when young children are present, compared to 77% when children outgrow the need for full-time child care (see Figure N). Single mothers of color are particularly at risk for lacking adequate resources when children are young with 89% of Latine, 92% of Black mothers, and 72% of Asian, Native Hawaiian, or Pacific

Islander mothers falling below the TCL. Even when the youngest child is old enough for full-day school (five years and older), resulting in reduced child care costs, 86% of Latine single mothers, 74% of Black single mothers, and 73% of Asian, Native Hawaiian, or Pacific Islander mothers have inadequate income.

Combining analysis by household type and race/ethnicity leads to some striking comparisons. Single mothers of color have consistently high rates of income inadequacy, regardless of their children’s age. Latine single mother led households were about three and a half times more likely to be struggling to make ends meet than White married-couple households without children. This disparity increases even more if the children are young. With child care closures, remote learning, and disruptions in the labor market, the COVID-19 pandemic placed new pressures on already struggling single mothers, especially single mothers of color.

The causes of these high levels of income inadequacy are many, including systemic racism, pay inequity, and gender and race-based discrimination, as well as the expenses associated with children.

Similar to trends across the U.S., in New York City, householders with higher levels of educational attainment tend to experience lower rates of inadequate income. However, women and people of color must have considerably more education than their counterparts to achieve the same levels of income adequacy.

As education levels increase, income inadequacy rates decrease dramatically (see Figure O). Of households in New York City with less than a high school education, 90% have inadequate incomes, while only 31% of those with a bachelor’s degree or more had inadequate incomes. That is, when the household lacked a high school diploma or equivalent high school degree, such as a GED, they are almost three times more likely to struggle to cover basic needs.

For households below the TCL in New York City, there are disproportionately more households represented who do not have a bachelor’s degree (see Figure P). While only 5% of all households in New York City have less than a high school degree or alternative high school degree, those households represent 10% of households below the TCL.

While educational attainment is an important safeguard against income inadequacy, not all groups benefit from increased education levels equally. The focus in both Figure O and Figure P was on the highest educational attainment in the household, the analysis will now shift to the lens of the householder in order to assess impact of education by sex and race and ethnicity. Certain trends remain consistent over time: people of color and women persistently have higher rates of income inadequacy.

• Increased education is associated with substantially lower rates of income inadequacy for all groups—especially for women householders. When the educational attainment of the householder increases from no high school diploma or equivalent to a bachelor’s degree or higher, income inadequacy levels fall from 81% to 31% for women (see Figure Q). In contrast, men have income inadequacy rates that range from 77% for those without a high school education or equivalent to 27% for those with a bachelor’s degree or more.

Source: U.S. Census Bureau, 2021 ACS 1-Year Public Use Microdata Sample.

+Includes

Source:

• Despite decreasing rates of income inadequacy for women with higher levels of education, the earnings gap between men and women remains persistent. As documented in Figure R, women earn less than men at every level of education. The gap increases as education increases: the median wage for men with a bachelor’s degree or higher is over seven dollars per hour more than women with the same level of education in New York City.

• The difference in income inadequacy rates between race/ethnic groups narrows with increased education, although households of color tend to have higher income inadequacy rates at each level. The difference in income inadequacy rates for householders without a high school diploma or equivalent high school certificate, such as a GED, ranges from 83% for Latine householders to 65% for other race or multiracial householders (see Figure S). Asian, Native Hawaiian, or Pacific Islander householders have the highest rate of income inadequacy for householders who have attained some college. Once householders achieve a bachelor’s degree or higher, the range shrinks slightly to 38% for Latine householders and 22% of White householders. Other than the category of no high school degree, White householders have consistently lower rates of income inadequacy as indicated in the light yellow bar of Figure S.

*The householder is the person (or one of the persons) in whose name the housing unit is owned or rented or, if there is no such person, any adult member, excluding roomers, boarders, or paid employees. This is an imputed estimate. As the ACS does not include an hourly pay rate, this calculated by dividing annual earnings by usual hours worked per week.

**Some college includes an associate’s degree, and some college credit but no degree.

+ Includes bachelor’s Degree or higher.

Source: U.S. Census Bureau, 2021 ACS 1-Year Public Use Microdata Sample.

*The householder is the person (or one of the persons) in whose name the housing unit is owned or rented or, if there is no such person, any adult member, excluding roomers, boarders, or paid employees.

**Some college includes an associate’s degree, and some college credit but no degree.

+Includes bachelor’s Degree or higher.

Source: U.S. Census Bureau, 2021 ACS 1-Year Public Use Microdata Sample.

• The combined effect of race/ethnicity and gender is such that women of color have the highest rates of income inadequacy. The percentage of women of color with inadequate income fell from 82% for those lacking a high school education or equivalent to 37% for those with a college degree or more, a decrease of 45 percentage points (see Figure T). Despite the dramatic decrease in income inadequacy rates when a bachelor’s degree is obtained, women of color in New York City are still significantly more likely to have inadequate income compared to White men with the same education levels.

*The householder is the person (or one of the persons) in whose name the housing unit is owned or rented or, if there is no such person, any adult member, excluding roomers, boarders, or paid employees.

**Some college includes an associate’s degree, and some college credit but no degree.

+Includes bachelor’s Degree or higher.

Source: U.S. Census Bureau, 2021 ACS 1-Year Public Use Microdata Sample.

• The disadvantages women and people of color experience as a result of systemic oppression are such that these groups need more education to achieve the same level of income as White men. While 70% of White men with no high school diploma are below the True Cost of Living, 69% of women of color with some college have inadequate income, only one percentage point less. Likewise, women of color

Figure T. Income Inadequacy Rate by Education, Race/Ethnicity, & Gender of Householder*

*The householder is the person (or one of the persons) in whose name the housing unit is owned or rented or, if there is no such person, any adult member, excluding roomers, boarders, or paid employees.

**Some college includes an associate’s degree, and some college credit but no degree.

+Includes bachelor’s Degree or higher.

Source: U.S. Census Bureau, 2021 ACS 1-Year Public Use Microdata Sample.

with a bachelor’s degree or higher have an income inadequacy rate only eight percentage points less than White men with some college (37% versus 45%).

At each educational level, both women and people of color, especially women of color, must attain higher levels of education than White men in order to achieve comparable levels of income adequacy.